As at the end of 2006, the total amount of lending outstanding (or debt) in the UK was £1,868.1bn, a rise of 12.9% on 2005 and 48.2% higher than the figure recorded in 2001. The amount of debt in the UK is currently a matter of considerable debate and concern.

This Key Note Market Report covers lending to both individuals, including consumer credit and loans secured on dwellings; and corporate bodies, including other financial corporations, non-financial corporations, unincorporated businesses and non-profitmaking organisations. In 2006, the largest sector was loans secured on dwellings, and the fastest-growing sectors between 2001 and 2006 were loans made to other financial corporations and loans to non-financial corporations.

The debt management and credit industry is faced with an ongoing array of legislation and regulatory changes. The most important of these included the introduction of the Consumer Credit Act 2006, which principally amends the Consumer Credit Act 1974.

The Competition Commission has also introduced measures aimed at increasing competition in the home-credit market, and the British Bankers' Association (BBA) and representatives of the Individual Voluntary Arrangement (IVA) industry have agreed to work together to create industry standards for that sector. The Financial Services Authority (FSA) has also commenced an investigation into the British sub-prime mortgage market and will assess, among other investigations, whether mortgage borrowers with poor credit histories are being treated fairly by lenders.

The IVA is one of the growth sectors of the debt management industry. Companies that provide IVAs for people who are unable to pay their debts receive fees from creditors for administering the scheme. However, the creditors involved, which include banks and other lenders, have decided to substantially reduce the fees they pay to the IVA providers. These reductions are expected to have a severe impact on the providers, and many have had to change their business plans considerably to accommodate the change.

The amount of lending outstanding to UK borrowers is forecast to continue to rise up to 2011, especially within the business sector. However, increases in UK interest rates could have a serious impact on the market and result in an increase in the number of borrowers defaulting on their loans. If this situation materialises, then demand for the services of debt management companies looks likely to remain strong.

1. Market Definition
REPORT COVERAGE
Consumer Credit Services
Commercial Credit Services
MARKET SECTORS
Lending to Individuals
Loans Secured on Dwellings
Consumer Credit
Other Lending
Loans to Other Financial Institutions
Loans to Non-Financial Corporations
Loans to Unincorporated Businesses and Non-Profitmaking Bodies
MARKET TRENDS
Amount of Outstanding Debt Continues to Increase Strongly
Rising Interest Rates
Individual Insolvencies
House Repossessions Increased in 2005
Minimum Repayments for Credit-Card Issuers
Providers of Individual Voluntary Arrangements
ECONOMIC TRENDS
Population
Inflation
Unemployment
Gross Domestic Product
Household Disposable Income
MARKET POSITION
The UK
Overseas

2. Market Size
THE TOTAL MARKET
BY MARKET SECTOR
Lending to Individuals
Loans Secured on Dwellings
Consumer Credit
Other Lending
Loans to Other Financial Institutions
Loans to Non-Financial Corporations
Loans to Unincorporated Businesses and Non-Profitmaking Bodies

3. Industry Background
RECENT HISTORY
NUMBER OF COMPANIES
EMPLOYMENT
REGIONAL VARIATIONS IN THE MARKETPLACE
Mortgage Possession Notices
Individual Insolvencies
Company Liquidations
DISTRIBUTION
HOW ROBUST IS THE MARKET?
LEGISLATION
The Consumer Credit Acts 1974 and 2006
Home Credit
Insolvency Laws
The Enterprise Act
KEY TRADE ASSOCIATIONS
APACS
Finance & Leasing Association
Consumer Credit Trade Association
Credit Services Association
Federation of European National Collection Associations
Asset Based Finance Association
International Capital Market Association
Council of Mortgage Lenders
Other Organisations

4. Competitor Analysis
THE MARKETPLACE
MARKET LEADERS
Cattles PLC
Company Structure
Current and Future Developments
Financial Results
Intrum Justitia Ltd
Company Structure
Current and Future Developments
Financial Results
iQor Ltd
Company Structure
Current and Future Developments
Financial Results
London Scottish Bank PLC
Company Structure
Current and Future Developments
Financial Results
Park Direct Credit Ltd
Company Structure
Current and Future Developments
Financial Results
Provident Financial PLC
Company Structure
Current and Future Developments
Financial Results
S&U PLC
Company Structure
Current and Future Developments
Financial Results
Other Companies
Allied International Credit (UK) Ltd
BCW Group PLC
Cash Flow Services Ltd
Controlaccount PLC
Debt Free Direct Group PLC
Inter-Credit International Ltd
JB Debt Recovery Ltd
Moreton Smith International Ltd
Philips Collection Services Ltd
OUTSIDE SUPPLIERS
Drakes Group Ltd
Equifax PLC
Experian Group PLC
Euler Hermes UK PLC
ICC Information Ltd
Kenyon Investigation Services Ltd
Regal Credit Consultants Ltd
MARKETING ACTIVITY
Main Media Advertising Expenditure
Exhibitions

5. Strengths, Weaknesses, Opportunities and Threats
STRENGTHS
WEAKNESSES
OPPORTUNITIES
THREATS

6. Buying Behaviour
MOST POPULAR SOURCES OF CREDIT
OWNERSHIP OF CREDIT AND DEBIT CARDS
HOME-COLLECTED CREDIT
OWNERSHIP OF A MORTGAGE
ATTITUDES TOWARDS CREDIT AND DEBIT

7. Current Issues
INTERNATIONAL ISSUES
A Warning by the Bank for International Settlements
US Sub-Prime Mortgage Lending Market Under Stress
THE POLITICAL SCENE
Competition Commission Opens Up Home-Credit Market to Competition
Office of Fair Trading Examination into Credit-Card Interest Calculation Methods
The Financial Ombudsman Service (Alternative Dispute Resolution Process)
INDUSTRY ACTIONS
Industry Standards for the IVA Sector
Concerns About IVA Advertisements
IVA Debt Escape Route Made Easier
CONSUMER TRENDS
Increase in the Number of County Court Judgements
CORPORATE ACTIVITY
Cattles PLC
Debt Advisor Group PLC
Debt Free Direct Group PLC
Park Direct Credit Ltd
Provident Financial PLC
LEGISLATIVE CHANGES
The Consumer Credit Act 2006

8. The Global Market
GLOBAL COMPARISONS
Household Indebtedness
EUROPE
Intrum Justitia's European Payment Index Survey
THE US

9. Forecasts
INTRODUCTION
The Economy
Population
Inflation
Unemployment
Gross Domestic Product
FORECASTS 2007 TO 2011
MARKET GROWTH
FUTURE TRENDS
High UK Household Sector Indebtedness
Gross Mortgage Lending Reaches New High
Rising Interest Rates

10. Company Profiles
Cattles Plc
Intrum Justitia Ltd
London Scottish Bank PLC
Provident Financial Plc

11. Consumer Confidence
METHODOLOGY
KEY FINDINGS THIS QUARTER
THE WILLINGNESS TO BORROW
Confidence Improves
Willingness to Borrow Slips Slightly
SPENDING FROM SAVINGS
Slight Increase in Spending from Savings
Saving Grows in Relative Importance

12. Further Sources
Associations
General Sources
Government Publications
Other Sources
Bisnode Sources